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Technology Costs
Definition The price of selecting, installing, and maintaining hardware, software, servers, and data storage to utilize data analytics. This price is often very high. Root Causes * Amount of data ** For companies to reap the greatest benefits out of their data analytics they have to combine and store a lot of different pieces of data throughout many years. Due to this large amount of data being collected and combined, many companies have to upgrade their IT systems, servers, applications, and processes to accommodate for all this data. * Technology is expensive ** For example, a SuperStorage Data Server costs about $15,890. The data server is state of the art for the time. It has 36 data drive racks, which ship with 1TB of storage each. Companies are able to upgrade to higher storage capabilities. This one data server can store 36,000 GB of data. Yahoo! deals with data amounts starting around 300,000,000 GB. Yahoo! would need around 8,334 SuperStorage Data Servers, for a total cost of $132,427,260. As you can see, these costs can add up quick. This simple calculation isn't even taking into account desktops for employees, tablets, software costs, licenses, or subscription fees. Effects of the issue Due to the amount of data that needs to be combined, old technologies may not be able to accommodate for the size of the data. Upgrades or investments in new technology may be needed to ensure that quality decisions can be made on all the data available. These upgrades and investments are often very costly and come with unexpected research and implementation time. ''[http://www.teradatamagazine.com/v13n04/Connections/The-Real-Cost-of-Analytics '''The Real Cost of Analytics''']'' by Richard Winter provides key insights into the costs of analytics. Richard Winter explains what "Enterprise Data Warehouse" and "Hadoop Technology" is, the costs of those technologies, and the effects those technologies can have on a company's data analytics. This article is key to understanding the cost of data analytics. Richard Winter reports the following cost estimates for upgrading technologies: * Enterprise data warehouse: Total cost of 500 TB = $30 million dollars * Hadoop technology: Total cost of 500 TB = $9 million dollars Enterprise data warehouse definition: a system that is used for data analyses and reporting. Is used as a central location for integrated data that comes from one or more sources. Hadoop technology definition: open source software that supports the storage and processing of large data sets. Forbes.com reports that Hadoop "parallelizes large data sets across low-cost commodity hardware for easy scale and dramatically reducing the cost of petabyte environments." In order for companies to not be surpassed by competitors, they must stay up-to-date on the latest technology trends. Purchasing hardware and software isn't the only issue here, there are also these issues listed in the table below: Importance Using data analytics helps companies harness the data they already have and also use it to explore new opportunities. In the end, this will lead to making faster and better decisions, generating new ideas, exploring new markets, reducing costs, and increasing profits. The cost of upgrading or investing in technology to enhance data analytics may cost a great deal of money, time, and energy, but it definitely can be worth it. '''Please view the following link''': [https://www.gooddata.com/blog/whats-true-cost-big-data Nucleus Research] recently reported that every one dollar spent on analytics, returned $13.01. The cost of technology may be great, but when the right technology is invested in, the return can be huge. Solutions * Ensure your organization creates a goal for what you want to accomplish by using data analytics. * Research technologies that provide the greatest benefits for the cost. * Base technology purchases on the desires that a company would like to gain from using data analytics. ***************************** [[IS 460 Data Analytics Wiki|Home]] / [[People]] *****************************